The Reality of Diversified Employees: Evidence from a 2014 RIETI survey on diversified work styles of regular and non-regular workers

Being confronted with the negative impact of a labor force shortage and a shift in the industrial structure, Japanese firms are trying to utilize diversified regular employees who are flexible in their work styles such as job duties, work location, or working hours. Regardless of the importance, however, the reality has not been elucidated. In this paper, we analyze a brand-new survey conducted by RIETI and present new evidence of the reality of diversified employees in terms of work style, recognition, transition system, termination of employment, and job satisfaction. We find that diversified employees 1) enjoy shorter working hours than employees who are not limited in work styles and 2) earn less income but are equally satisfied with their jobs as other employees. We also find that 3) employees with flexible working hours have more job satisfaction and 4) diversified employees are more involved with their supervision and feel accelerated growth in their jobs. These results suggest that the effectiveness of a diversified employee system depends not only on the labor contract on flexibility but also on the employment management in the workplace.